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Police have made an arrest in connection with last week's eBay sale of a computer hard drive containing personal data.

The latest information security lapse has happened in Charnwood in Leicestershire, where taxpayers' personal details were found on a computer which was sold for £6.99. The details are said to include bank account information and sort codes.

Charnwood Borough Council has said that it is investigating the incident and has traced the hard drive and is awaiting its retrieval.

The Council said that it reported the matter to the police, who have now arrested someone in relation to the sale of the machine.

"The case has been referred to Leicestershire Constabulary as a criminal investigation and we can confirm that an individual has been arrested and is assisting the police with their enquiries," said a statement from the Council. "We have traced the hard drive and are currently retrieving it. The purchaser is co-operating with Charnwood and has stated that the data has not been distributed to any other parties."

Leader of Charnwood Council Richard Shepherd promised that a review into the data loss would be held.

“I regret the concern caused to Charnwood residents by this serious matter," said Shepherd. "We will give every assistance to the Police in their further investigations and I will personally ensure a thorough review is also completed by the Council to find out how this happened.”

Last week a machine was taken from a company which stores banks' records, Graphic Data. The laptop contained banking information on up to a million customers of Royal Bank of Scotland, NatWest and American Express.

Privacy regulator the Information Commissioner's Office last week urged organisations to create privacy protections in every new system they build because organisations are storing more and more information on individuals.

“For many years we have urged organisations to consider the impact on individuals’ privacy before developing new IT systems. However progress has been disappointing," said Jonathan Bamford, assistant commissioner at the ICO. "In our view organisations could be doing more to protect individuals’ privacy by adopting ‘privacy by design’."

Editor's note</strong: When this story first appeared it referred to a laptop being sold on eBay. We understand that only a hard drive was sold. We apologise for the error.

Copyright © 2008, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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